Liquidation of the Family Partnership: The Taming of the Shrewd

Practical Tax Lawyer, Vol. 20, Winter 2006

Posted: 5 Apr 2006

See all articles by Samuel A. Donaldson

Samuel A. Donaldson

Georgia State University College of Law

Abstract

Family partnerships and family limited liability companies are typically formed for reasons of efficiency, succession, and valuation. But all good things come to an end. Owners of a family partnership opt for liquidation in a variety of situations, usually following the death of the founding owner(s). Although most practitioners recall that the liquidation of a partnership is not a taxable event, few remember that as many as three Code provisions can come into play upon the liquidation of a family partnership. This article reviews those potential income tax traps and uses two examples to illustrate their coordination and application in a typical setting.

Keywords: partnerships, liquidations, tax, estate planning

Suggested Citation

Donaldson, Samuel A., Liquidation of the Family Partnership: The Taming of the Shrewd. Practical Tax Lawyer, Vol. 20, Winter 2006, Available at SSRN: https://ssrn.com/abstract=894983

Samuel A. Donaldson (Contact Author)

Georgia State University College of Law ( email )

P.O. Box 4037
Atlanta, GA 30302-4037
United States

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